The impact of human resource strategies on the retention of engineers in Malaysian firms

Abstract

Excessive external labour mobility overseas, to Singapore, and inter-firm by knowledge workers, particularly engineers, is thought to be hampering Malaysia s drive for knowledge economy status. The role of firms human resource practices in addressing this problem is explored by analysing the factors that could contribute to improved professional engineer retention, based on firm-level partnership in knowledge-creation.

In Western Human Resource Management (HRM) literature, employee retention is defined as one of the key firm-level strategic (SHRM) goals. The challenge in knowledge worker retention however is the pull of firm-external occupational labour markets, in which careers often called protean (self-directed), or boundaryless , are pursued in order to remain valuable by building expertise. Push factors are added when engineers do not perceive firms as providing organisational support for career development, or the mutual exchange that creates a psychological contract .

Testing these concepts with Malaysian engineers and HR managers, the thesis explores the extent to which firms provide forms of engagement and career support that might counter job hopping by creating a sense of psychological mobility through professional growth. The notions of psychological contract (PC) and perceived organisational support (POS) are used to conceptualise engineers intention to stay (ITS) and are seen as mediating the relationship between HR policies/programs/practices and engineers ITS.

Through a mixed-method design based on a survey of engineers as well as interviews with HR practitioners and engineers, the study combines top-down and bottom-up perspectives on the factors shaping engineers turnover intentions and their causes. Interviews with HR staff and engineers reflect a mechanistic/operational rather than a strategic role of HR departments in Malaysian engineering firms, with employee development regarded as costly, and in some cases little sense of partnership or reciprocity. The survey results indicate significant links among the quantity and quality of HR programs available, POS, PC, and engineer s ITS. Career development opportunity and skills training emerge as the HR strategies most likely to influence ITS, meeting engineers self-efficacy needs. Despite engineers pragmatism, the sense of a mutually-satisfying relationship emerges as a retention factor. Interviews reveal the influence of HR policies and practices in engineers complex career mobility decisions.